IN THE SUPREME COURT OF MISSISSIPPI

NO. 96-CA-00193-SCT

THE MISSISSIPPI GAMING COMMISSION

v.

TREASURED ARTS, INC.

DATE OF JUDGMENT: 01/09/96

TRIAL JUDGE: HON. ROBERT LEWIS GIBBS

COURT FROM WHICH APPEALED: HINDS COUNTY CIRCUIT COURT

ATTORNEYS FOR APPELLANT: J. ROD NIXON

LEYSER Q. MORRIS

ATTORNEYS FOR APPELLEE: TIM WAYCASTER

DAVID WAYNE BARIA

NATURE OF THE CASE: CIVIL - STATE BOARDS AND AGENCIES

(OTHER THAN WORKERS' COMPENSATION)

DISPOSITION: AFFIRMED - 9/11/97

MOTION FOR REHEARING FILED:

MANDATE ISSUED: 10/2/97

BEFORE PRATHER, P.J., ROBERTS AND MILLS, JJ.

ROBERTS, JUSTICE, FOR THE COURT:

STATEMENT OF THE CASE

¶1. This case was originally filed by Treasured Arts, Inc. (TAI), as a Complaint for Declaratory

Judgment and for Other Relief in the Circuit Court of the First Judicial District of Hinds County,

Mississippi on May 22, 1995, against the Mississippi Gaming Commission (MGC). The lower court

was requested to declare that two products, Dinosaur Art Cards and Treasured Art Phone Cards, did

not fit the definition of a lottery and are legally marketable in Mississippi. Both products were

marketed with a game piece attached that is similar to "scratch-and-win" game pieces distributed as

promotional devices by marketers of other products in the state.

¶2. Each party filed Motions for Summary Judgment, limiting the issues to whether consideration was

being paid for the game piece portion of the product, thereby constituting an illegal lottery under the

prior holdings of this Court and the laws of Mississippi. There was a factual dispute as to what the
correct retail value was to be attributed to each per minute unit of long distance time. TAI submitted

an affidavit showing the price it had to pay for each unit was $.66. The MGC produced an affidavit

showing the price charged by another long distance carrier to be $.45 per unit. This potential fact

issue was resolved when TAI stipulated to the second affidavit for purposes of the Motions for

Summary Judgment only.

¶3. On December 27, 1995, the lower court granted TAI's Motion for Summary Judgment relying on

Williams Furniture Co. v. McComb Chamber of Commerce, 112 So. 579 (Miss. 1927). MGC

appeals the ruling of the lower court raising the following issues:

I. WHETHER CONSIDERATION FOR A CHANCE TO WIN A CASH PRIZE WHEN

A CONSUMER PURCHASES LONG DISTANCE TIME IN EXCESS OF THE USUAL

VALUE OF THE LONG DISTANCE TIME AND RECEIVES THE CHANCE TO WIN

A PRIZE.

II. WHETHER THE TREASURED ARTS POWER CALL CARD IS A LOTTERY

UNDER THE LAWS OF MISSISSIPPI.

STATEMENT OF THE FACTS

¶4. TAI sells the Treasured Arts Power Call Card (Card). The Card costs $2 and allows three

minutes of long distance telephone talk time with United States Long Distance (USLD), a long

distance telephone service provider. The long distance talk time is prepaid by TAI and is guaranteed

to be provided to the purchaser of the Card.

¶5. The Card is perforated, with one side containing a "scratch-and-win" game piece and the other

written instructions on how to receive a maximum of three minutes long distance phone time through

USLD. The Card may be torn in half, and the purchaser has the opportunity to win monetary prizes

ranging from $1 to $50,000 from the "scratch-and-win" game.

¶6. This Card was presented to the MGC for a formal opinion as to its legality. MGC, through its

attorney Carole Brand, responded by letter of March 2, 1995, that it would not issue a formal opinion

and provided no additional direction to TAI as to the legality of the Card. Subsequently, TAI filed its

Complaint in the lower court seeking declaratory judgment.

¶7. The MGC initially took the position that a distinction exists between games like the Pepsi Cola

bottle cap game or the Jitney Jungle "scratch-and-win" game and the TAI Card game, because in the

other games the purchaser receives a valuable product or service in exchange for his money and those

game pieces are free. The MGC contended that a purchaser receives nothing of value when

purchasing the Card, therefore any consideration paid for the Card is actually consideration for an

opportunity to play the game.

¶8. Affidavits submitted to the lower court regarding the price as to retail value of per minute long

distance time were conflicting. However, TAI stipulated to the per minute valuation by Miss. Lynn

Reeder, a LDDS WorldCom employee, for purposes of the Motions for Summary Judgment. Her

affidavit stated that the PhonePass pre-paid cards have a retail worth of $.45 per minute, which was

the tariffed rate. She continued that the LDDS cards could be sold at a cheaper rate depending on the
retailer.

¶9. The MGC contends that the TAI Card constitutes a lottery in violation of both Mississippi

common and statutory law. The MGC states that the Card offers a prize by chance and consideration

is given for the chance to win that prize. TAI retorts that neither the MGC nor any other state agency

nor the courts of this state on a case-by-case basis should be in a position of determining what any

given product is worth to any given consumer thereby establishing what a fair consideration should

be for the product.

DISCUSSION OF THE ISSUES

I. WHETHER CONSIDERATION FOR A CHANCE TO WIN A CASH PRIZE WHEN

A CONSUMER PURCHASES LONG DISTANCE TIME IN EXCESS OF THE USUAL

VALUE OF THE LONG DISTANCE TIME AND RECEIVES THE CHANCE TO WIN

A PRIZE.

II. WHETHER THE TREASURED ARTS POWER CALL CARD IS A LOTTERY

UNDER THE LAWS OF MISSISSIPPI.

¶10. Because these issues are so intertwined and virtually the same such that the answer to one will

sufficiently provide an answer to the other, the Court will discuss the two together. To begin, it is

necessary to delineate the appropriate standard of review.

¶11. The Court employs a de novo standard of review in reviewing a lower court's grant of summary

judgment motion. Roussel v. Hutton, 638 So. 2d 1305, 1314 (Miss. 1994). Summary judgment is

appropriate if the evidence before the Court--admissions in the pleadings, answers to interrogatories,

depositions, affidavits, etc.--shows there is no genuine issue of material fact, and the moving party is

entitled to judgment as a matter of law. Newell v. Hinton, 556 So. 2d 1037, 1041 (Miss. 1990). This

Court does not try issues on a Rule 56 motion, but only determines whether there are issues to be

tried. Mississippi Ins. Guar. Assoc. v. Byars, 614 So. 2d 959, 963 (Miss. 1993). In reaching this

determination, the Court examines affidavits and other evidence to determine whether a triable issue

exists, rather than the purpose of resolving that issue. Comment, Miss. R. Civ. P. 56.

¶12. The common law definition of a lottery is: "(1) The offering of a prize; (2) the awarding of a

prize by chance; (3) the giving of a consideration for the opportunity to win the prize; and all three of

these elements must concur in order to constitute a lottery." Williams Furniture Co. v. McComb

Chamber of Commerce, 112 So. 579, 579-80 (Miss. 1927). The offer of a prize and an award are

not enough by themselves to be considered a lottery. A purchaser must actually give consideration

for the opportunity to win the prize. Id.

¶13. The Legislature enacted Miss. Code Ann. § 75-76-3, which incorporates the same three basic

elements of consideration, chance and prize. The pertinent portion of that section is set forth as

follows:

(6) The Legislature recognizes that Section 98 of the Mississippi Constitution of 1890 prohibits

the conducting of any lottery in this state and that, while not defining the term "lottery," Section

98 clearly contemplates, as indicated by specific language contained therein, that a lottery
involves the sale of tickets and a drawing in order to determine the winner. The Legislature also

recognizes that Section 98 of the Mississippi Constitution of 1890 directs the Legislature to

provide by law for the enforcement of its provisions. Therefore, in carrying out its duties under

the Constitution and effectuating the intent of Section 98, the Legislature hereby finds that a

lottery, as prohibited by the Constitution, does not include all forms of gambling but means any

activity in which:

(a) The player or players pay or agree to pay something of value for chances, represented and

differentiated by tickets, slips of paper or other physical and tangible documentation upon which

appear numbers, symbols, characters or other distinctive marks used to identify and designate

the winner or winners; and

(b) The winning chance or chances are to be determined by a drawing or similar selection

method based predominately upon the element of chance or random selection rather than upon

the skill or judgment of the player or players; and

(c) The holder or holders of the winning chance or chances are to receive a prize or something

of valuable consideration; and

(d) The activity is conducted and participated in without regard to geographical location, with

the player or players not being required to be present upon any particular premises or at any

particular location in order to participate or to win.

Miss. Code Ann. § 75-76-3 (6)(a-d).

¶14. The parties are in disagreement as to whether a purchaser of a Card actually pays any

consideration for the opportunity to chance to win a prize such that there is a violation of subsection

(a) of the statute. TAI asserts that the consideration paid for the Card is paid for the card itself and

not for the game piece attached. If true, this would mean no consideration is paid for the opportunity

to win a prize and the product does not constitute a lottery. However, the MGC claims the purchaser

of a Card is paying more than the maximum retail value for per minute long distance time, which

results in consideration for the opportunity to win the monetary prizes offered by TAI.

¶15. Here, as in Williams Furniture Co., this Court is called upon to determine whether a

promotional scheme is a lottery. In Williams Furniture Co., merchants were permitted to give

customers tickets that could be used by the customer on either the purchase of $1 worth of goods or

a $1 payment on the customer's account; however, no tickets could be sold to customers. 112 So. at

580. A drawing was held, and prizes awarded to the winning ticket holders. Id. The Court found that

the promotion did not constitute a lottery, because it lacked the element of consideration for the

opportunity to win the prize.

¶16. The MGC attempts to distinguish the case sub judice and Williams Furniture Co., by stating

the price of the Card exceeds the usual price of per minute long distance time. Therefore, according

to the MGC, something of value is given for the chance to win a prize. The MGC, citing Miss.

Reeder's affidavit, inaccurately asserts the maximum usual retail value of this type of per minute

phone time for long distance is $.45.
¶17. As stated earlier, this Court reviews all the evidence, including affidavits, presented to the lower

court prior to its ruling on the Motion for Summary Judgment. The record before this Court presents

two separate grounds justifying an affirmance of the trial court.

¶18. The first is presented in the affidavits submitted by each side as to what the price per minute

long distance time cost. The MGC provided an affidavit by Miss. Reeder, an employee of LDDS

WorldCom. That document indicated what price LDDS WorldCom charged per minute with its

PhonePass pre-paid phone card. There is no mention in her affidavit as to what the maximum value

that could be charged by another long distance server, namely USLD.

¶19. TAI presented an affidavit of Kenneth F. Melley, Jr., who is Vice President of Regulatory

Affairs for USLD. Melley stated in that document that the price charged per minute for long distance

time by USLD was $.66. He asserted that the wholesale purchaser, in this case TAI, could print the

actual cards with images or without images and the price would still remain $.66 per minute as

charged by USLD. In other words the price pre-paid per minute for long distance service by TAI was

actually $.66.

¶20. In order to avoid a possible genuine issue of material fact, TAI stipulated to the information in

Miss. Reeder's affidavit for purposes of a ruling on the Motion for Summary Judgment. However, on

appeal the review of the lower court's grant of summary judgment is de novo. Therefore, this Court

revisits both affidavits of Mr. Melley and Miss. Reeder. We find that Miss. Reeder's affidavit has no

relevance to the facts in this case. The information contained in her affidavit pertains to rates charged

by an entirely separate long distance carrier than the one which supplied long distance time to TAI.

Any price charged by LDDS WorldCom to its customers has absolutely no bearing on the price

charged by USLD. Mr. Melley stated the amount charged for long distance time was $.66 per

minute. The Card sold by TAI was priced at $2 and provided three minutes of long distance time.

Therefore, each minute cost a fraction over $.66. No consideration over the price actually charged to

TAI was paid by the retail purchasers of the Card for an opportunity to win a prize.

¶21. In a capitalistic society competition is the axis on which a free market turns. The MGC's

argument that a price charged by one long distance carrier which exceeds the price charged by

another is necessarily consideration for an opportunity to win a prize is without merit. The lower

court should have never considered the affidavit of Miss. Reeder as binding authority as to what "the

maximum retail value" of long distance service should be. Granted it is authority as to what LDDS

WorldCom charges for its long distance time. But there is not one scintilla of evidence that what one

company charges for long distance time is binding on another as the maximum retail value.

¶22. The affidavit of Mr. Melley clearly shows the price per minute was $.66 for long distance time.

The Card was sold for $2 and allowed up to three minutes of long distance service. No consideration

over the price of the value of the long distance time was paid by purchasers for an opportunity to win

a monetary prize. The lower court correctly granted TAI's Motion for Summary Judgment.

¶23. Second, the lower court relied on the fact that no purchase was actually necessary to obtain a

game piece. TAI states that the most compelling indicator that consideration is not paid for the game

piece portion of the Card is that TAI gives away the game piece free to anyone who requests it. The

rules of the game provided for a procedure for obtaining a free game piece by sending a selfaddressed, handwritten, stamped envelope and a 3 x 5 card, with the words "Phone Card 25."
¶24. The MGC responds that in order to obtain a free game piece one has to endure a onerous and

complicated process. Because no free game piece is provided where the Card is sold, a consumer has

to make a written request through the mail at a cost of $.64 cents for stamps, a minimal cost for a

notecard and envelopes, and the time and effort to send for the game piece. The lower court noted

the MGC's position in its opinion stating: "Finally, the Gaming Commission points out that while a

consumer may obtain a free game piece from Treasured Arts, the process is so onerous as to make it

impractical."

¶25. The MGC failed to provide the lower court with any authority or any evidence to support its

argument that the process was "so onerous as to make it impractical" to obtain a free game piece.

Most importantly the record before this Court is void of any evidence or authority to support this

argument. Unsupported assignments of error will not be considered by this Court on appeal. Ellis v.

Ellis, 651 So. 2d 1068, 1073 (Miss. 1995).

¶26. Notwithstanding the MGC's unsupported assertions, this Court finds that there is nothing "so

onerous" about requiring someone who wishes to have a free game piece to submit their request in

writing. This is a process that is common in many promotional and sweepstakes type contests. There

is no evidence that persons who wanted a free game piece by mail were unable to obtain them by

following the prescribed procedures in the contest rules.

CONCLUSION

¶27. The lower court failed to exclude the affidavit of Miss. Reeder regarding the prices charged by a

different long distance carrier than the one providing service to TAI. Prices charged by LDDS

WorldCom had absolutely no bearing on prices charged by USLD, which was the long distance

carrier used by TAI. Competition and free market enterprise are the foundation of our capitalistic

society.

¶28. The unsupported assertion by the MGC that the process to obtain a free game piece by mail is

too onerous is not considered by this Court on appeal. Further, such an assertion is without merit.

This process for requesting a free game piece from TAI is commonly used in other promotional and

sweepstakes type contests. The record is simply void of any evidence showing persons were unable

to obtain the free game pieces due to an onerous requirement by TAI.

¶29. The lower court granted summary judgment based on evidence that the Card had some value.

The court stated that it mattered not whether the Card was worth $.66 or $.14, it was apparent it was

worth something. The court then narrowed its only issue to whether the consideration paid for the

Card, which had some value, amounted to the giving of consideration for the game piece, which

granted the chance to win a prize. The court then granted summary judgment based on its finding that

the Card was an item that had value and consideration was paid for it and concluded no consideration

was paid for the game piece. The lower court refused to get into a dispute as to whether the

consideration paid for the Card was adequate or not, reasoning that this Court had never done so.

¶30. This is all superfluous due to this Court's de novo standard of review in appeals where summary

judgment has been granted. This Court is to review all of the evidence before the lower court to

determine if there were no genuine issues of material fact so that the moving party was entitled to a
judgment as a matter of law. The affidavit of Mr. Melley shows that TAI was charged $.66 per

minute for long distance time. The Card was sold for $2 for three minutes of long distance usage.

The record before this Court supports the lower court's grant of summary judgment in favor of TAI.

The MGC did not produced any evidence to refute or call into dispute the fact that TAI used USLD

as its long distance carrier and was charged $.66 per minute for long distance time. The only evidence

provided by the MGC in the record was the affidavit of Reeder, which stated the prices charged by

LDDS WorldCom, not the carrier used by TAI.

¶31. We disagree that the amount of consideration is not at issue for the reasons stated above.

Nevertheless, the lower court reached the correct result based on the evidence in the record before

this Court. The affidavit of Melley and the fact that the game pieces could be obtained free through

the mail support TAI's Motion for Summary Judgment. The MGC provided no evidence in the record

to constitute a genuine issue of material fact. Therefore, the Court holds that TAI was entitled to a

judgment as a matter of law.

¶32. AFFIRMED.

PRATHER AND SULLIVAN, P.JJ., PITTMAN, BANKS, McRAE, SMITH AND MILLS,

JJ., CONCUR. LEE, C.J., CONCURS IN RESULT ONLY.